Who Speaks for the Small Businesses?

A company that formerly had only a handful of competitors might find that it has dozens or even hundreds of competitors.

A friend of mine has a theory about the current state of health care coverage. Why, he asks, would large corporate interests be opposed to any policy that reduces the coverage burden they have to provide to their employees? Not only have they opposed all reform efforts, they have failed to provide any proposals of their own. (If anyone has a link that contradicts this statement, we would both be interested in seeing it.)

My friend's theory is this: if health insurance were affordable and easy to get, more people would attempt to start businesses. A company that formerly had only a handful of competitors might find that it has dozens or even hundreds of competitors. How many of those competitors would be nimbler, more imaginative, have better products, or better service? In short, my friend's theory says that the status quo helps large businesses retain their market share.

I don't know if my friend's right, but I couldn't help thinking about his theory while reading an article in this morning's Star about how health care reform is a promising prospect for mom-and-pop businesses. It hit me when I reached this couplet of statements approximately one quarter of the way into the article:

"Much of America’s business community has lobbied hard against the health care plan, contending that such things as mandated coverage and Medicare tax increases would cost them dearly.

Yet the crew at YJ’s, and 32 million other Americans, would shift from uninsured to covered. This group of 10 people [the YJ employees], in fact, looks to come out well ahead under the proposal."

Some of you might remember that a few years ago the Broadway Cafe made the New York Times by surviving on the same block where Starbucks failed. The explanation must surely lay in the quality of its service and the fact that it roasts its own beans. But, is it not a contributing factor that said Starbuck's was also competing with the Westport Coffee House, Coffee Break, The Roasterie, The Coffee Girls, Mildreds, YJ's, Oak Street Coffee, The City Market Coffeehouse, The Filling Station, etc., all supplied by local roasting operations? This situation exists in spite of Starbucks' generous benefits package, which surely gives it a competitive advantage in the barista market.

This issue raises a broader question that I keep asking. Who speaks for the Broadway Cafe's of the world in the halls of power? I can't escape the impression that the needs of small businesses are underrepresented. Yet all I have are anecdotes.

There is a growing body of evidence that small businesses are the engine of economic growth. In light of this evidence, we can no longer afford the luxury of assuming that policies good for large businesses are also good for mom-and-pops.

A million questions come to mind. Is the city bureaucracy friendly to businesses of all kinds? Do any of our incentive programs help one set of businesses at the expense of others? In other words, how level is the playing field? Why is this issue not reflected in the City Council's annual legislative priorities?

Whether it belongs at the state or national level, health care reform is not the purview of City Hall. That doesn't mean City Hall can ignore the small business issue. Lately I've been hearing talk about this issue coming out of City Hall. I hope it's not just lip service.